Startup Pano Logic on Monday announced an all-hardware virtualization device, about the size of a deck of cards, that is designed to replace the PC.

Unlike thin clients, the Pano Logic device does not use any software or even drivers, so executives claim that it cannot be infected by malware. Moreover, the device virtualizes I/O, so that end users can plug in a USB device or printer and use it over the network. Pricing for the device starts at $20 per month per device, with perpetual licenses available.

According to Pano Logic executives, the devices perform the same functions that PCs do  virtualizing keyboard and mice movements, storage, I/O, as well as either Windows XP or Microsoft's Windows Vista operating system. The devices are designed to work with VMware Server; if a small or medium business doesn't have it, the Pano Logic software includes a VMWare installation when the Pano Logic software installs as well. Pano can be installed on top of an existing VMware ESX deployment.

And although the company isn't targeting thin clients directly, executives made the point that customers have to pay for and set up the thin client software itself  although Pano Logic's solution pushes that software onto the server.

"I don't think you're going to see us replacing thin client or terminal services. It's not our area of interest," said Nick Gault, the chief executive of Pano Logic, and the former chief executive of virtualization company XenSource, which he left a year ago.

"This is really a replacement for desktop PCs. This is a strong statement. Why is this a strong statement? Because thin clients share a server, so that it is not a true Windows experience. There's a limited degree of customization, limited to certain drivers and applications. It's not all the way Windows."

The Pano Logic devices contain no CPU, no memory and no OS; they include audio-in and audio-out ports, as well as three USB connections, a VGA video connection, 10/100 Ethernet, and a power connector. Inside each device is a custom Pano Logic chip that manages the virtualization.

The devices themselves consume five watts, a fraction of the typical PC power load.

However, IT administrators must still decide whether the tradeoffs of a virtualized environment  a small amount of local hardware to manage  is enough to offset the latency issues of controlling a remote OS over the network. According to Gault, the devices work well using a 5-ms latency over the local network, as well as even over a WAN.

From a security standpoint, USB storage can be disabled, preventing users from copying files onto thumb drives; the software can also manage and control the types of devices that will be allowed access to the network, theoretically preventing malware from being uploaded to the system.

Each of the devices also contains a small, triangular button, the sole source of end-user managed support. Pushing the button pops up a menu that an IT administrator can configure, but will generally be used to restore a user's virtualized Windows implementation to an earlier, stable image, Gault said.

The Pano devices have already been deployed into the field, in both an undisclosed network of doctor's offices and in a regional bank, according to Mike Fodor, Pano Logic's vice president of product management.

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